Global Tax and Legal November 2015 Grants & Incentives program updates The latest legislative developments from around the world
Countries included This update provides a summary of the latest developments affecting Grants & Incentives and Research & Development programs. For more information, please contact the local partner of the respective program directly. Germany United Kingdom United States For more information
Germany manufacturing/ict/ measurement industry Energy Research Program Energy efficiency in production processes The Energy Research Program is aimed at R&D activities that seek to increase the energy efficiency in production processes: Innovative developments relating to thermal processes in production Increasing the efficiency of techniques for the use of industrial waste heat Innovative measurement and control systems for the optimization of energy usage in production Increasing material efficiency in the area of energy-intensive raw materials Energy-efficient process technology No overall budget published Collaborative projects with at least two partners. Participation of SMEs is recommended For companies, grants of up to 50% of eligible costs can be awarded, provided there is an own contribution of at least 50%. The funding ratio for SMEs may be higher For universities and research institutions, grants of up to 100% of eligible costs can be awarded Non-repayable cash grant to a consortium Deadline Ongoing submission Isabel Antholz (Senior Manager) or Oliver Hasse (Senior Manager) iantholz@deloitte.de or ohasse@deloitte.de Tel no. +49 (0) 40 32080 4910 or +49 (0) 89 29036 7340
Czech Germany manufacturing/sensor Republic except of Prague technology/adas / private sector Investment Transport Research Incentives Program: - Special New Industrial vehicle Zones and system as Investment technologies Incentives The new transport research program, New vehicle and system technologies is aimed at R&D projects in the following areas: Automated driving: including specifically innovative sensors and actuation systems; high-precision localization; fast, inter-vehicle and vehicle-to-back end communication solutions; (sensor) data fusion and processing; man-machine-interaction Innovative vehicles: reduction of energy consumption and emissions in road and rail transport including specifically increase in energy efficiency by using light weight construction; optimized aerodynamic characteristics; reduced frictional resistance in the complete drive trains; innovative drive train technology No overall budget published Participation of SMEs is obligatory (a minimum of a 30% direct or indirect participation of SMEs is required) For companies, grants of up to 50% of eligible costs can be awarded, provided there is an own contribution of at least 50%. The funding ratio for SMEs may be higher Research institutions that are basically financed by the country in certain cases Funding period is two to three years Non-repayable cash grant to a consortium Deadline Submission of project outline (first stage): 31 March and 30 September each year Isabel Antholz (Senior Manager) or Oliver Hasse (Senior Manager) iantholz@deloitte.de or ohasse@deloitte.de Tel no. +49 (0) 40 32080 4910 or +49 (0) 89 29036 7340
Germany energy - Energy suppliers/grid / Grid operators/ / ICT / Manufacturing ICT/manufacturing Innovative stem cell technologies for personalized medicine Kopernikus project for energy revolution The program is aimed at funding R&D projects that identify suitable technologies for the Energiewende (the transition by Germany to an energy portfolio dominated by renewable energy, energy efficiency and sustainable development) and develop them up to a demonstration level. Focus areas are: New network structures (e.g. definition of communication standards) Flexible usage of renewable energy resources/power-to-x (e.g. economical usage and storage concepts) Industrial processes and fluctuating energy supply (e.g. integration of energy intensive production in new energy supply scheme) Transformation and connection of energy supply (e.g. system integration and new market regulations) Cross- and interdisciplinary cooperation of scientific and technical institutions and companies with a project duration of at least three years is required Funding of up to EUR 10 million per year and project For companies, grants of up to 50% of eligible costs can be awarded, provided there is an own contribution of at least 50%. The funding ratio for SMEs may be higher For universities and research institutions, grants of up to 100% of eligible costs can be awarded Projects must achieve a higher technology maturity level during the project duration Non-repayable cash grant to a consortium Deadline Submission of project outline (first stage): 8 January 2016 Isabel Antholz (Senior Manager) or Oliver Hasse (Senior Manager) iantholz@deloitte.de or ohasse@deloitte.de Tel no. +49 (0) 40 32080 4910 or +49 (0) 89 29036 7340
United Kingdom collaborative R&D (scheme 1) Cross-platform production in digital media Competition run by Innovate UK to support projects that address convergence in digital media technologies. The competition covers film, television, online video, animation and video games, and covers pre-production, production and post-production processes, particularly for visual effects technologies. Projects must be business-led, collaborative and focus on industrial research. Projects are expected to last nine to 18 months and to range in size from GBP 300,000 to GBP 750,000. GBP 4 million Cash grant Reimbursement rates (eligible project costs): Small businesses: Up to 70% Medium-sized businesses: Up to 60% Large businesses: Up to 50% Deadline Two-stage process: 23 December 2015 (registration) and 6 January 2016 (stage 1 applications); 10 March 2016 (stage 2 for invited applications). Steve Conibear stconibear@deloitte.co.uk Tel no. +44 29 20264325
United Kingdom-India collaborative R&D (scheme 2) UK-India collaborative industrial R&D competition: Clean-tech, affordable healthcare and ICT Joint Innovate UK and the Indian government competition to support projects that propose new commercial solutions to critical challenges impacting the socio-economic growth and development of India in relation to its clean-tech, healthcare and ICT sectors. India must be the principal market. Projects must be collaborative and involve a UK and an Indian lead business, but other businesses and research organizations can collaborate in the consortium. Projects are expected to range in size from GPB 350,000 to GBP 450,000 (UK project costs) and last for up to 24 months. GBP 3.4 million Cash grant For UK participants, small or micro businesses could receive up to 70% of their eligible project costs, medium-sized businesses 60% and large businesses 50% Deadline 13 April 2016 (registration); 20 April 2016 (applications) Steve Conibear stconibear@deloitte.co.uk Tel no. +44 29 20264325
United Kingdom-China collaborative R&D (scheme 3) UK-China research and innovation bridges competition Joint competition with Innovate UK, the Research Councils UK (RCUK) and the Ministry of Science and Technology (MoST) for the People s Republic of China to support projects that propose new commercial solutions to critical challenges impacting the socio-economic growth and development of China in relation to energy, healthcare, urbanization and agri-food. China must be the principal market. Projects must be collaborative, involving both UK and Chinese participants, with both a UK lead partner and a Chinese lead partner. On the UK side, projects can be led by a business or a research organization. Projects are expected to range in size from GPB 800,000 to GBP 1 million (UK project costs) and last for up to 24 months. GBP 16 million Cash grant For UK participants, small or micro businesses may receive up to 70% of their eligible project costs, medium-sized businesses 60% and large businesses 50%. Deadline Two-stage process: 23 March 2016 (registration) and 30 March 2016 (stage 1 applications); 24 August 2016 (stage 2 for invited applications). Steve Conibear stconibear@deloitte.co.uk Tel no. +44 29 20264325
United States/North Carolina Job Development Investment Grant Program (JDIG) The JDIG is a discretionary incentive that provides sustained annual grants to new and expanding businesses measured against a percentage of withholding taxes paid by new employees. JDIG grants can result in payments to a business for up to 12 years, or 20 years for a high-yield project. A high-yield project is defined as a project for which the agreement requires that a business invest at least $500 million in private funds and create at least 1,750 eligible positions. The sunset date is extended to 1 January 2019. The maximum amount of total annual liability for grants awarded in any single calendar year is USD 20 million for a year in which no grants are awarded for a high-yield project and USD 35 million for a year in which grants are awarded for a high-yield project. Grant program Deadline Sunset date has been extended to 1 January 2019. Douglas Tyler dtyler@deloitte.com Tel no. +1 212 436 3703
United States/New York City New York City biotechnology tax credit For taxable years beginning on or after 1 January 2010, and before 1 January 2019, a taxpayer that is a qualified emerging technology company that engages in biotechnologies, and meets certain additional criteria can claim the following three New York City tax credits: 1. A credit of 18% of the cost or other federal income tax basis of research and development property and certain other costs and fees 2. A credit of 9% of qualified research expenses 3. A credit of 100% of its training expenses, up to USD 4,000 per employee per calendar year. The credit may be claimed against the general corporation tax and unincorporated business tax for amounts paid or incurred for certain facilities, operations, and employee training in New York City. It generally is limited to companies with 100 employees or less, 75% of which are located in New York City, in addition to certain other eligibility criteria. Application and approval is required to claim the credit. The total amount of credit allowable to a taxpayer cannot be more than USD 250,000 per year and USD 3 million for all companies combined. Tax credit Deadline New York City s authorization to allow a biotechnology credit against the general corporation, unincorporated business and banking corporation taxes has been extended for three years, through taxable years beginning before 2019. Douglas Tyler dtyler@deloitte.com Tel no. +1 212 436 3703
United States/Rhode Island Rhode Island New Job Creation and Real Estate Incentives Rhode Island has launched two new incentive programs: Qualified Jobs Incentive Tax Credit and The Rebuild Rhode Island Tax Credit. The Qualified Jobs Incentive Tax Credit provides a base tax credit for (1) companies relocating to the state and creating a minimum number of new jobs, and (2) for current Rhode Island companies growing their in-state workforce by a threshold percentage. The Qualified Jobs Incentive Program s annual base tax credit is USD 2,500 for each new full-time job created or up to USD 7,500 per job if specific criteria are met. The Rebuild Rhode Island Tax Credit provides a tax credit of up to 20% of project costs to qualified real estate projects of USD 5 million or more that demonstrate a financing gap. The Rebuild Rhode Island Tax Credit has a cap of USD 15 million per development project. Fiscal incentives Deadline Effective 30 June 2015. The credit sunsets on 31 December 2018. Douglas Tyler dtyler@deloitte.com Tel no. +1 212 436 3703
United States/New York City New York City Relocation and Employment Assistance Program and Lower Manhattan Relocation and Employment Assistance Program The Relocation and Employment Assistance Program and Lower Manhattan Relocation and Employment Assistance Program offers business income tax credits for relocating jobs from outside of New York City or below 96 th Street in Manhattan to designated locations above 96 th Street in Manhattan or in one of the other four boroughs and eligible areas of Lower Manhattan. The amount of these credits can range from USD 1,000 - USD 3,000 per year per job for 12 years tied to employment growth in an eligible area. Credits may be refundable for the year of relocation and the next four years, if they meet certain requirements. Unused credits from subsequent years may be carried forward for five years. N/A Fiscal incentives Deadline Sunset has been extended to 1 July 2017 Doug Tyler dtyler@deloitte.com Tel no. +1 212 436 3703
For more information For more information on any of the programs listed above, please contact the in-country representative or your usual contact. For further information on how Deloitte can assist with available grants and incentives please contact: Natan Aronshtam Global Managing Director R&D and GI, DTTL naronshtam@deloitte.ca +1 416 643 8701 Alistair Davies Director, Deloitte UK aldavies@deloitte.co.uk +44 (0) 2920 264272 Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee ( DTTL ), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as Deloitte Global ) does not provide services to clients. Please see www.deloitte.com/about for a more detailed description of DTTL and its member firms. Deloitte provides audit, consulting, financial advisory, risk management, tax and related services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than 150 countries, Deloitte brings world-class capabilities and high-quality service to clients, delivering the insights they need to address their most complex business challenges. Deloitte s more than 225,000 professionals are committed to making an impact that matters. Deloitte serves 4 out of 5 Fortune Global 500 companies. This communication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or their related entities (collectively, the Deloitte Network ) is, by means of this communication, rendering professional advice or services. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. No entity in the Deloitte Network shall be responsible for any loss whatsoever sustained by any person who relies on this communication. 2015. For information, contact Deloitte Touche Tohmatsu Limited.